Some of my blog entries may be taken as theoretical exercises. While I make use of the latest thinking, most of the things I write about are in fact directly extracted from personal experience. It is my attempt to turn what could otherwise be called frustrations into constructive insights. I felt this short introduction was necessary simply to add a degree of credibility to what follows. Now let’s get back on topic.

Let’s start with a preview of my thesis. My argument rests on three observations: (1) innovation is vital to our future; (2) innovation is slowing down; (3) current HR practices are a contributing factor. Having argued my case, I will end by providing a few ideas on possible solutions.

(1) Innovation is vital for our future

In my blog entry on why innovation is vital to our survival, I call out the relationship between progress and energy. Basically, progress depends on the amount of energy we are able to extract from our environment and put to purposeful use. Technology, the buffer between our chaotic environment and our (more) orderly society, requires energy. Since any particular energy source is limited (either in amount or in output), breakthrough innovation is constantly required to make new types of energy available for our exploitation.

(2) Breakthrough innovation is slowing down

Some of the top innovation thinkers in the world are saying exactly this: breakthrough innovation is slowing. Clay Christensen, arguably the top authority on innovation, presents a distinction between empowering, sustainable, and efficiency innovation. Empowering innovation refers to breakthroughs that create new products and therefore new jobs, while sustainable and efficiency innovation simply improve existing products, resulting in a zero or even negative sum game when it comes to jobs. He contends that short term financial performance pressures force the private sector to move away from break-through innovation in favor of sustainable and efficiency innovation. This he further contends presents a risk to capitalism itself, as only breakthrough innovation can create jobs. Roger Martin, another top authority on innovation, contends that “the pace of innovation is slowing due to the takeover of business by science.” What Roger means by “science” is natural science, i.e. the application of analytic and reductionist thinking to innovation, which results in incremental rather than breakthrough progress. Roger goes further to point to a “reliability thinking” bias in business, with a preference for analysis applied to past performance to peer into the future, based on the flawed assumption that the future will be like the past (for an exploration of the pitfalls of applying engineering thinking to management, see my related blog entry). 

(3) Current HR practices are a contributing factor to the slowing pace of breakthrough innovation

Roger Martin’s “reliability thinking” insight has been reinforced by my own  experiences with the HR practices. HR professionals are expected to reliably chose candidates for jobs. This focus on reliability looks at past performance as the best indicator for future success. The entire HR tool set (Curriculum Vitae, etc.) and best practices are biased to “reliably” extrapolating future performance by extending the career trend-lines from the past, making sure to stay within the industry/functional boxes defined by past positions. What the HR industry doesn’t realize is that this very insistence on reliability results in a view of human capital as an incremental, “linear” asset, while the most valuable and unique traits of the human condition (creativity, imagination) are in fact discontinuous processes. Great careers of spectacular innovators a-la Steve Jobs that cross industry and functional boundaries would come across as unreliable through the lens of the current HR practices. The insistence on staying within the industry/functional boxes framed by keyword searches, also erroneously assumes that human qualities cannot be generalized across professions, setting up artificial barriers to talent flow. As Einstein said, imagination is more important than knowledge, yet HR practices insist on measuring knowledge. Since the main engine of the so called “knowledge economy” is human capital, the “reliability thinking” bias in human capital selection and promotion is in my opinion and personal experience a significant contributor to the slowing of breakthrough innovation, with an embedded risk for humanity’s future.

So what if any solutions are out there? I propose that one of the first steps to aligning HR best practices with a qualitative view of human capital is new tools that capture the discontinuous nature of human development. Having been designed in an industrial era where human capital was seen as an extension of industrial processes rather than an autonomous and purposeful intellect, the Curriculum Vitae is grossly unsuited for capturing these types of professional capacity leaps that drive break-through innovation. I have developed a notional model for human capital development that allows for discontinuous leaps in professional capacity resulting from the inference between generalized mental models, functional roles, and outcomes. These three elements are assessed in terms of evolution against a qualitative sophistication scale so that career potential can be evaluated in terms of the likelihood of the next professional capacity leap. This is to some extend in line with Elliott Jaques and his Requisite Organization Theory. 

In closing, I would like to dedicate this entry to my friend Radu Furnica, the only HR professional I have so far met who is fully aligned with the thinking introduced above.